Shares of chicken restaurant chain El Pollo Loco traded down 21 percent on Friday as the company reported disappointing same-store sales and provided a weak outlook.
El Pollo Loco is one of many recent initial public offering high fliers down significantly this year, with returns ranging from negative 20 to 50 percent.
Also, the Renaissance Capital IPO index, which tracks the performance of companies that went public in the last two years and counts stocks such as Twitter, Alibaba and Hilton among its top holdings, is about to turn negative year to date.
One savior for these struggling new companies could be a takeover after zulily, an online retailer which went public in late 2013, was acquired by John Malone's Liberty Interactive on Monday for $2.4 billion.
But zulily, whose shares lost nearly half their value this year before the takeover, may be the exception to the rule as most investors believe the trend will be lower for these broken IPOs.